Chapter 3 - National Differences in Economic Development

Gross Domestic Product (GDP)

Measure total monetary or market value of all the finished goods & services produced w/i a country's borders in a specific time period

Purchasing Power Parity (PPP)

Adjustment in GDP per capita to reflect differences in the cost of living

Human Development Index (HDI)

Attempt by the UN to assess the impact of a number of factors on the quallity of human life in a country

Innovation

Development of new products, processes, orgs, management practices, & strategies

Entrepreneurs

Those who first commercialize innovations

Deregulation

Removal of gov't restrictions concerning the conduct of a business

First mover advantages

Advantages accruing to the first to enter a market

Late mover disadvantages

Handicaps experienced by being a late entrant in a market

Political Risk

Likelihood that political forces will cause drastic changes in a country's business environment that will adversely affect the profit & other goals of a particular business enterprise

Economic Risk

Likelihood that events, including economic mismanagement, will cause drastic changes in a country's business environment tht adversely affect profit & other goals of a particular business enterprise

Legal Risk

Likelihood that a trading partner will opportunistically break a contract or expropriate intellectual property rights